Tuesday, June 30, 2009

I am going to try a new thing in the spirit of sharing best practices called the Lean Roundup. Once a month I will roundup posts from other Lean practitioners that are particularly noteworthy and share them here. There is an abundance of very useful information to help you on your Lean Journey in pursuit of True North.

Saturday, June 27, 2009

As part of this journey to find “True North” it is important to share best practices. A common saying in the Lean community is to “steal shamelessly”. We often follow this up with “adopt then adapt”, meaning to implement improvement then work to improve said improvement.

Recently, I observed an activity that is worth sharing. A common solution in 5S activities is the use of shadow board to organize and display tools. Many times these shadow boards may be at the point of use in a work space where tools and items don’t move far. In this case the shadow board technique was used in shared tool room for many trades. The issue that came up was how do you know a tool is missing rather than in use by a trade member. The team came up with idea of using a name token to hang on the shadow board. This name token would indicate that this individual is utilizing this tool.

Through the use of a simple visual the team has saved significant time to keep track of tools which has supported sustaining this shadow board in a shared work space like this tool room. Prior to this improvement the team spent a lot of non-value added time to see whether tools were in use or not by someone.

Wednesday, June 24, 2009

Highly empowered and effective teams are the key to compete in today’s world of high technology processes, six sigma quality and continuous innovation. We have all heard the adage that “There is No I in Team” but what does that really mean?

A group is two or more people who interact with each other to accomplish a goal. A team is a group with complementary skills who are committed to a common purpose defined by a set of performance goals and hold themselves mutually accountably. All teams are groups, but, not all groups are teams. What distinguishes a team from a group? Below is a table that can be used to tell the difference.

Groups don’t just become teams because we use that name and it is not about teamwork. Teams act as a collective unit with shared commitment and not a band of individual contributors. Just like in Lean the whole, or in this case, the team is greater than the sum of the individual parts. Teams often are more difficult to form because it takes time for members to learn to work together. Management must support and encourage the use of teams in there organization.

Highly performing and effective teams use a set of values that encourage listening and responding constructively to views expressed by others, giving others the benefit of the doubt, providing support, and recognizing the interests and achievements of others.

Leaders in a lean environment should advocate the discipline that teams must share to be effective rather than just establishing working groups.

Saturday, June 20, 2009

Transforming a traditional organization to a lean organization is about creating a cultural change. The only way to create a sustainable cultural change is to change behavior. Many lean initiatives have failed from complications in changing behavior. Bob Emiliani who has studied lean transformations and lean behaviors was the first to use the term “fat” behavior.

In production environments waste is defined as actions that consume resources but do not add value to a product in the eyes of the customer. Many in the lean community are relentlessly and systematically eliminating this waste which limits business performance and threaten prosperity. Why hasn’t the concept of waste been extended to the behaviors of individuals and groups within the workplace? Perhaps it is harder to recognize and much harder to quantify.

The concept of “lean” behaviors is analogous to lean production. Lean behaviors are defined simply as behaviors that add or create value. It is the minimization of waste associated with arbitrary or contradictory thoughts and actions that leads to defensive behavior, ineffective relationships, poor co-operation, and negative attitudes. A person exhibiting lean behaviors is most easily recognizable by their ability to resist the temptation to contribute wasteful verbal or gestural content to conversations. While, fat behaviors are defined as behaviors that add no value and can be eliminated. They include the display of irrational and confusing information that results in delays or work stoppages, or the articulation of unsubstantiable subjective thoughts and opinions. Fat behaviors are recognizable as lots of talk where nothing has actually been said, or indirect words whose meanings are subject to variable interpretations. Fat behavior results in waste while lean behavior promotes flow between people.

It is hard to recognize the tremendous waste that normally exists in intra- and interpersonal relationships. Below is a table that compares common fat behaviors with selected lean behaviors:

Many of the consequences of fat behaviors relate to the loss of employee commitment. Employees, who do not feel they are being heard, will reduce their participation in the business. Over time, they feel more alone, less confident in themselves and their decisions, and become less committed to achieving the goals of the organization. They may become complacent in their work area because of their deteriorated attitude, which in turn reduces their performance and lowers their potential for future opportunities. The economic impact of fat behaviors is felt not only by the employee, but by the company as well since its workers may not have the commitment or energy to meet the demands of competition in a global market.

Fat behavior prevents us from improving and this leads to poor performance due to costly delays, rework, and poor co-operation. Far too often effective employees are those we characterize as “Heroes” and “Firefighters”. Unfortunately it is difficult to reflect, strategize, or engage in root cause analysis of problems since reward systems are well aligned with crisis management. Management and lean leaders have the primary responsibility for being in-tolerant to fat behaviors. Just like the seven wastes within lean operations behaviors also exhibit the same wastes. Below is an example of the behavioral seven wastes.I think we all know people in our workplace who may exhibit behaviors like the ones below:

The “Respect for People” principle consists of two parts: “Respect” and “Teamwork,” and is as follows:“RESPECT: We respect others, make every effort to understand each other, take responsibility and do our best to build mutual trust.TEAMWORK: We stimulate personal and professional growth, share the opportunities of development and maximize individual and team performance.”

The lean community must teach others to eliminate “fat” behavior like we do other wastes by advocating and practicing “Respect for People” so that organizations can truly transform to a Lean culture with lean behaviors.

Wednesday, June 17, 2009

With the recent bankruptcy of General Motors, Jim Womack wrote a letter on The End of an Era. Womack is considered one of the originators of Lean Thinking in the US from studying Toyota in the 1980’s. His first book the Machine that Changed the World is the first books I ever read on Lean. I thought it would be worth reviewing a couple of points in Jim’s letter.

Many in the lean community have compared the traditional US company model like those of GM to that of the Lean Japanese company model of Toyota. Jim makes the case that GM’s bankruptcy marks the end of this narrative.

For 30 years now the Lean Community has benefited from a strong trailing wind. GM steadily declined as Toyota steadily advanced. All we needed to do was standby and cheer! But this narrative is over.

He takes the time to pause and reflect on what this means. Reflection is one of the most powerful learning opportunities we have. I wonder if this is really the end of an era or just another rest stop along the lean journey. If you don’t know where you have been, how do you know where you are? So what does the GM story teach us?

It is too convenient to say that the Lean model at Toyota has been proven to be successful while the Non-Lean model at GM has not. GM has practiced Lean management for a very long time and Toyota’s struggles are far from over as seen with its own financial crisis. Jim characterizes GM’s problems as:

At the beginning of 2009, GM had three major weaknesses. It had too much legacy debt – bondholders and retirees. It had compensation costs for current employees that were too high to compete with transplant operations in North America. And the money it received for its products in most segments of the market was far below average, partly as a legacy of decades of defective products and partly due to losing the pulse of the public on what the company and its products should mean for customers.

GM’s problems are not necessarily new problems. The legacy costs and high compensation has been well discussed and symbolic of greed within our society. Remembering, Goldratt’s Goal is “to make money now as well as in the future.” You can’t afford the bottom line items of benefits and compensation if the top line items like revenue are not there. Jim under-emphasizes GM’s lack customer focus. For decades, GM has lost market share in the car industry to other foreign competition like Toyota. This resulted in lower profitability for the car manufacturer. GM’s employees and management had a lack of long term thinking. They managed by the situation, contract, current negotiation, and short term measures. This contributed to this growing burden on the company that was not sustainable in the long run.

Lean is about eliminating waste by flowing product at the pull of the customer. It is a value proposition of the right things, right place, right time, right quantity, and right cost. Value as defined in the customer’s eyes. Simply GM stopped making product (cars) that the customer wanted. As Jim noted, GM has spent a lot of effort recently talking about what they are not but they need to get back to the voice of the customer. This will be even harder with a third party (the government) involved where they will likely try to regulate what products consumers want.

Toyota also lost its way in recent years. Their focus turned from customer orientated company to a company driven to be #1 in the automotive market place. This short term vision and the financial strain from expansion to be #1 has put them in an awkward financial position. They lost touch with the basics of slow organic growth, long term decisions, development of people, and voice of the customer. This was recognized earlier this year with Toyota’s new president:

Toyota Motor Corp.'s incoming president, Akio Toyoda, has a sobering message for the giant company founded by his grandfather: It has gotten too fancy for its own good.

Upon reflection the lesson that can be learned here is the important of adding value in terms of the customer’s voice combined with a long term vision. While GM and Toyota both suffered from a lack of practicing this, their results are different. One has set a new course for the future and the other is trying to do so now with help (bankruptcy process).

Jim also points out that this is a turning point for lean. I believe he is right but differ slightly on why. Jim states:

GM and almost all large manufacturers have now accepted lean as a management theory, although the actual practice is always a struggle.

While he does clarify this statement with "large companies", the statistic is closer to 35% of all companies are practicing Lean. Of which only 5% of those companies are truly sustaining the gains. Lean has started to be applied in lots of new industries and service organizations. The reason this can be done is from its basic elements of adding value to the customer through waste elimination by developing people to solve problems. Lean has a much larger arena than we really know. The real purpose of Lean practitioners is to teach others to “see” this ideal so they can start their own new era.

Monday, June 15, 2009

The Gemba Academy provides high quality online video training for individuals and groups. They currently have the School of Lean but will add later this summer the School of Project Management and the School of Six Sigma.

We learned at the Gemba, or the place the work is done, and now we want to help you and your organization succeed. As a result, we are pleased to introduce the Gemba Academy School of Lean. When you enroll in the Gemba Academy School of Lean you gain immediate access to high definition online learning modules, interactive quizzes, PDF summary documents, lean templates, audit sheets, and calculators.

The Gemba Academy allows individuals to register for free to get a newsletter and access to free preview videos. They also offer a monthly subscription option and 6 month subscription option which allows you full access to all their courses and documents. The School of Lean is currently available with 33 videos, or more than 7 hours of viewing plus many more hours of reading and self-test quizzes. In addition to the Introduction to Lean, the 10 Commandments of Improvement, 5S Workplace Productivity and Transforming Your Value Streams courses they have now added nine videos in The 7 Deadly Wastes set.

Sunday, June 14, 2009

Gemba Panta Rei is a weblog about better ways to make things better from Gemba Research. Gemba Research is a global team of professionals dedicated to teaching kaizen and Lean management practices based on the Toyota Production System.

Gemba is the Japanese term for “actual place”, often used for the place where value-creating work actually occurs. It is place you go for improvement. Panta Rei is a Greek term for “everything flows, meaning that everything is constantly changing. Therefore in combination Gemba Panta Rei roughly mean things are always changing on the shop floor.

The authors of this weblog post at least daily so there is a vast collection of information. They really leave no topic uncovered. You can find reviews of books, templates/forms, tips for implementers, and discussion various lean concepts and tools. Since they write frequently many articles relate to current events. Personally, this is the place I go every few days to stay abreast of changes within the Lean community.

Wednesday, June 10, 2009

It is often said that lean is 90% people and 10% tools. Knowledge is the factor which determines the rate of change in organizations. How do we learn and teach this knowledge within our organization? Many organizations use a “train the trainer” method where knowledge is handed down from one individual to the next. This is like the school age game “telephone” where one person tells a story to someone who tells someone else and so on till the end of the line where the final result is a variant of the original. The variation from this type of training can result in confusion, longer cycle times, rework, and defects.

A lean tool that can be employed for teaching is a Single Point Lesson, SPL (or One Point Lesson). Single point lessons originated from TPM (Total Productive Maintenance) as a method to teach knowledge and skills necessary for autonomous maintenance.

Keeping in mind this mantra:Teaching occurs when an opportunity for Learning is presented.
Learning occurs when there is a change in behavior.
Teaching is only VALUABLE when there is a subsequent change in behavior

The single point lesson is used to communicate single idea effectively in five to ten minutes on one page. An effective single point lesson has the following characteristics:
· Visual supported pictures, diagrams, or drawings
· Short and focused
· Self initiated and self taught
· Generated and used at the point of need

As an aid for spreading best practices company-wide, single point lessons can support and enhance improvement efforts. The purpose of single point lessons include:
· Communicating knowledge and skill about the asset amongst members of the team.
· Raising the knowledge and skills of the team in a very short period of time.
· Eliminating problems and for making improvements to the way of working.
· Making sure that everyone knows about a better way of doing something.
· Making sure that next time a problem is encountered everyone knows the way to solve it.

A single point lesson is a learning tool for communicating standards, problems, and improvements across a wide range of processes and work environments. Thus, single point lessons may contain information on a number of topics.

Single point lessons should not replace work instructions or standard operation procedures but they can support and simplify instructions and procedures. Single point lessons are an effective training tool because:
• They are easy for shop floor people to develop – anyone can make one!
• They are easy for shop floor people to deliver – anyone can be a trainer!
• They don’t take long to develop or deliver.
• They facilitate discussion between team members.
• People want to share their skills and knowledge rather than hoarding it.

There are endless opportunities for single point lessons as a learning tool in your organization. How can you apply single point lessons?

Wednesday, June 3, 2009

A recent poll by the Lean Enterprise Institute (LEI) shows that companies are giving more emphasis to Lean efforts during today’s economic pressures. Lean initiatives are increasingly being recognized as helping businesses through many challenging periods sometimes referred to as “burning platforms”.

Related to this there was an interesting survey done recently by Stiles Associates, LLC (a lean-focused search firm) on what lean and operational leaders are doing in our current economic crisis.

Here are just a few of the highlights:*Operational improvement programs have been highly effective at helping companies respond to the recent market turmoil.*Cost cutting is everyone’s top priority.*Three out of four companies are increasing or maintaining their improvement project activity.*Corporate visibility and expectations of lean initiatives has increased.*As the recession deepens, short-term cash and working capital priorities are reducing the ROI cycle time for all projects.

While I am not surprised that lean has helped companies through this economic time, I am surprised by the top priorities of many businesses. I understand a true need exists to cut costs especially during period decreased revenue. The concern is the impact this has on the long-term competitiveness of a company. Priorities related to the customer values and new products/services are half of the cost cutting priority. One-third of the companies responded that their continuous improvement staff and improvement training activities would be less than last year.

These economic events have a way of challenging a company’s commitment to lean principles. Are these current cost saving measures really just part of a short term focus due to this special cause variation? It is really survival thinking and not “Lean Thinking.” As Jeffrey Liker characterized the first principle of TPS is about a long-term philosophy. “Base your management decisions on a long-term philosophy, even at the expense of short-term financial goals.” This means adding value for the customer. In order to generate this value to the customer we need to listen to the customer.

If you focus all your efforts on cutting costs then who is customer focused? What products and services will customers need in the future? This should be a time to of innovation, development, and investment. Leaders should be investing in developing people. The focus should be on developing the skills and knowledge need to bring operational excellence to these next generation products and services.

All products and services have some sort of life time. They won’t be viable for ever. The customer and the market place are ever changing. Many businesses have some sort of growth target related to revenue and OI but the true goal is “to make as much money now as in the future”. Cost reduction efforts will help companies make money now and stay in business to make money in the future you can’t forget the customer. Without providing the customer “value” you won’t be in business in the future either.

The survey points out that those companies that expect an increase or no change in revenue are increasing or maintaining their focus on Lean and training. Of which those companies increasing spending are focused on customer value/service and quality improvements. A company’s revenue numbers should not drive management’s decisions on the direction of the business.

Leaders probably should have more emphasis (or at least equal emphasis) on customer values, new product/services, and improvement training since these will have a higher contribution to the long term plan of businesses than the short term focus of cutting costs because the top line sales have declined.

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Tim McMahon is the Founder and Contributor of A Lean Journey Blog. This site is dedicated to sharing lessons and experiences along the Lean Journey in the Quest for True North. The blog also serves as the source for learning and reflection which are critical elements in Lean Thinking.

Tim is a lean practitioner with more than 10 years of Lean manufacturing experience. He currently leads continuous improvement efforts for a high tech manufacturer in a Quality Management role.

Tim McMahon is a member of ASQ Influential Voices who facilitate discussions regarding quality matters globally.